RCW 28B.10.423 establishes a
higher education retirement plan supplemental benefit fund, in the custody of
the state treasurer, for the purpose of funding future higher education
retirement plan supplemental benefits.
(1)
Who finances the HERP supplemental
benefit fund? Higher education employers pay into the HERP supplemental
benefit fund at an employer contribution rate as established in
RCW
28B.10.423 on the salaries paid to employees
participating in their HERP.
(2)
Who are the higher education employers? For the purpose of this
section, higher education employers, as defined by
chapter
28B.10 RCW includes:
(a) All state universities;
(b) All regional universities;
(c) All state colleges;
(d) All community and technical
colleges;
(e) The state board for
community and technical colleges; and
(f) Any other higher education entities
granted authority for HERP coverage under
chapter
28B.10 RCW.
(3)
How are the assets in
the HERP supplemental benefit fund invested? The Washington state
investment board (WSIB) is responsible for investing HERP supplemental benefit
fund assets. For investment purposes, the assets may be commingled with other
trust fund accounts in the commingled trust fund (CTF).
(4)
How are assets in the HERP
supplemental benefit fund used? Assets in the HERP supplemental benefit
fund are held in trust for the purpose of funding future higher education
retirement plan supplemental benefits. Assets will remain in this fund until
the legislature authorizes distribution(s).
(5)
What role does the department of
retirement systems (department) have in administering the HERP supplemental
benefit fund? The department will:
(a)
Collect employer HERP contributions from higher education employers;
(b) Deposit HERP contributions into the HERP
supplemental benefit fund;
(c)
Provide buy/sell investment information to WSIB; and
(d) Account for the fund's assets, including
each employer's contributions and the earnings on those
contributions.
(6)
What information will higher education employers be responsible for
reporting to the department? Each higher education employer will be
responsible for reporting the total HERP salaries paid and the contributions
owed on those salaries. HERP salaries include the salaries paid to all
employees participating in the employer's higher education retirement plan,
regardless of employee eligibility for the supplemental benefit portion of the
plan.
(7)
Are HERP salaries
reportable as they are earned or as they are paid? HERP salaries are
reportable as they are paid.
(8)
When are HERP reports and payment of HERP contributions due to the
department? Reporting and payments of HERP salaries and contributions
should coincide with the employer's payroll periods. HERP reports and
contribution payments for a calendar month are due on or before the 15th day of
the calendar month following payment of the HERP salaries. Reports and
contribution payments are considered overdue if not received by the close of
business on the third business day after the due date.
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Example:
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A higher education employer pays $50,000 in HERP
salaries on January 10th. The same employer pays another $50,000 in HERP
salaries on January 25th. The employer must report the HERP salaries paid for
both payrolls and make payment of the contributions due on the total combined
$100,000 HERP salaries to the department by February 15th.
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(9)
Does the department charge interest on overdue payments of contributions
for the HERP supplemental benefit fund? Yes. The department charges
interest on overdue contributions to the HERP supplemental benefit fund at the
rate of one percent per month simple interest. Interest is charged for each day
the payment is overdue. Assessed interest will appear on the employer's monthly
accounts receivable statement from the department.
(10)
Can the department charge
employers an administrative expense fee for the HERP supplemental benefit
fund? Yes.
RCW
41.50.110 authorizes the department to charge
employers an administrative expense fee for expenses related to the
administration of the HERP supplemental benefit fund.
